So, your experience can be summed up thus (ignoring the ethnicities of the involved workers, since they don't matter): The $8/hour worker wouldn't do it.
The $12.50/hour worker wouldn't do it.
But the $15/hour worker would.
That doesnt quite sum it up yet. The american worker would have to be paid 18-20/hour, working the same hours, to equal the 15 paid under the table.
You can pay an American worker "under the table"...it happens every day for one-off jobs, everytime cash gets paid and the recipient doesn't declare it on their taxes.